Monday, March 31, 2008

The blame game is on

Increasingly municipal borrowers are starting to cry 'foul' when they see the cost of their loans going up. Their anger strikes me as odd considering their quiet indulgence while they were on the receiving end of the easy money binge. They should rather shut up and accept the new realities. It would be better for the people they represent if they would focus more on solutions how to get the heck outa there.

some examples:
Massachusetts Secretary of State William Galvin said March 28 he is probing Zurich-based UBS AG, Merrill Lynch & Co. in New York, Bank of America Corp. of Charlotte, North Carolina, and other dealers over how they marketed the securities. The same day, UBS cut the value of auction debt held by its customers by about 5 percent.

``It's outrageous,'' said Rory Burnett, finance director of Vernon, California's smallest incorporated city. Located four miles south of downtown Los Angeles, Vernon lost $7 million since mid-February on auction-rate bonds the industrial enclave sold to cut borrowing costs for power plants and natural gas contracts.

The cost to protect the bonds of Iceland's three biggest lenders from default rose after central bank Governor David Oddsson said ``unscrupulous dealers'' are trying to break the country's financial system. Oddsson called for an international investigation into attempts to drive Iceland's economy ``to its knees,'' in a speech on March 28.

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